[broadband genie] A new report from Danish Industry Analysts Strand Consulting accuses the EU, with its recent move to cap roaming data costs, of using the mobile telecoms industry as a crowd pleaser to make itself more popular with Euro-skeptics.
In a fairly strongly worded report the company, which has 14 years experience of analysing telelcoms markets, described the EU cost capping as "an aggressive regulation of end user prices".
The report comments: "It sounds good when you say that it should be cheaper to roam and it also sounds good when you promise the population cheaper SMS and mobile data. The problem is that the regulation you make on selected market areas distorts the market both technologically and regarding prices."
It argues that this kind of regulation makes the EU more popular with smaller EU countries which have a history of blocking EU political projects; in much the same way that a government will pander to certain sections of the voting public in the run up to an election. However, it argues that this regulation will have a strong negative impact on the telecoms markets which the EU has not considered, by creating a distorted competitive market situation, which in turn will influence investments and which technologies will dominate in the future.
It also points out that no other industry is as comprehensively regulated at EU level as the telecoms industry is: "What about the food industry, the transport sector, shoe industry, toy industry, auto industry, medicine or industry etc - all industries with less competition and significantly less regulation - or no regulation at all."
The company concludes that in the pursuit of short term goals - i.e. popularity, the EU is threatening to destabilise Europe's otherwise healthy telecoms markets, reducing competition and creating conditions which will be extremely detrimental to consumers.
EU roaming price caps not so good after all, report claims
see also Strand Consult